Countdown to retirement

[Dan Murphy]

no - totally different rant, lol. I was piggybacking on the posts discussing teacher/govt WEP rules by commenting that there are a few other rules in SS land as well, that don't seem quite fair to everyone playing.

My example is anyone not a W-2 employee (gig workders.) We pay employER and employEE social security tax - so 15% of every dollar plus 2x the medicare tax as well. Yet we don't accrue any more retirement dollars for double the spend than employees who just pay half of what we do.

Sorry OP and others: I didn't meant to hijack the Counting Down to Retirement thread.

Ahhhh, I see. Makes sense now. I am familiar with your thoughts there. Though now retired, for many, many years, and until retirement 4 years ago at age 76, I was both a W2 and 1099 person. So I do understand the employee/employer thoughts on the 1099 side.

 

[sk!mom]

We didn't ask. But it is kind of part of a Financial Planner's responsibility as a Fiduciary to disclose those things even if they are on assets outside their control. He also disclosed that the High Tech Fund he put us in in 1999 lost 75% of it's value.

It’s his responsibility to run scenarios of what could have been had you made a different choice?? I don’t see that at all.

Disclosing the bad outcome of an investment he put you in, of course it must be revealed. But saying, “hey, your decision to transition to safer investments cost you $$$.” I now question everything about his professionalism.

 

[tvguy]

It’s his responsibility to run scenarios of what could have been had you made a different choice?? I don’t see that at all.

Disclosing the bad outcome of an investment he put you in, of course it must be revealed. But saying, “hey, your decision to transition to safer investments cost you $$$.” I now question everything about his professionalism.

Wow, you certainly have a different view. I expect a Financial Planner to know all my financial information and evaluate all our decisions. To do otherwise would be a violation of his fiduciary responsibility and be VERY unprofessional. Your Financial Advisors can't have blinders on.

 

[sk!mom]

Wow, you certainly have a different view. I expect a Financial Planner to know all my financial information and evaluate all our decisions. To do otherwise would be a violation of his fiduciary responsibility and be VERY unprofessional. Your Financial Advisors can't have blinders on.

Revealing the outcome of decisions made, yes. Complete transparency prior to any decision being made, yes. Years after the decision, running numbers on a different path than you chose, what’s the point? So you can rub her nose in it?

 

[tvguy]

Revealing the outcome of decisions made, yes. Complete transparency prior to any decision being made, yes. Years after the decision, running numbers on a different path than you chose, what’s the point? So you can run her nose in it?

The point is, a Financial Planner should review past decisions to help clients make better informed future decisions. Not necessarily different decisions. That's not :rubbing your nose" in it IMHO.
He even monitors the value of the classic car I bought 9 years ago as well as the value of our house.*

EDIT *Actually, those values are monitored by software that many Financial Planners use that uses public date. He doesn't appraise the car or the house on annual basis.

 

[sk!mom]

The point is, a Financial Planner should review past decisions to help clients make better informed future decisions. Not necessarily different decisions. That's not :rubbing your nose" in it IMHO.
He even monitors the value of the classic car I bought 9 years ago as well as the value of our house.*

EDIT *Actually, those values are monitored by software that many Financial Planners use that uses public date. He doesn't appraise the car or the house on annual basis.

I just asked an expert and he said absolutely not, a good financial planner is not going to say, “Hey, that decision you made 10 years ago? Big mistake, huge! You could have another $200,000 had you chosen a different path.” That ship has sailed. There’s no point. Financial planners report on investments made and advise on current/future investment plans. Once a decision is “not” made- it’s off the spreadsheet. A planner doesn’t track every scenario he presented you for what would have been had you chosen it.

Monitoring the value of all your assests (including classic cars), of course.

 

[tvguy]

I just asked an expert and he said absolutely not, a good financial planner is not going to say, “Hey, that decision you made 10 years ago? Big mistake, huge! You could have another $200,000 had you chosen a different path.” That ship has sailed. There’s no point. Financial planners report on investments made and advise on current/future investment plans. Once a decision is “not” made- it’s off the spreadsheet. A planner doesn’t track every scenario he presented you for what would have been had you chosen it.

Monitoring the value of all your assests (including classic cars), of course.

Well, we will have to agree to disagree. He didn't advise her either way 10 years ago, just said she had reasonably reached an account balance that would carry her through retirement, and that she needed to decide if she wanted to remain aggressive and risk losing that principle, or be more conservative and preserve it. Just the facts, no commentary from him.

. He did also comment on an IRA my wife opened 44 years ago with $1,500 that is now worth almost $100,000.

 

[sk!mom]

Well, we will have to agree to disagree. He did also comment on an IRA my wife opened 44 years ago with $1,500 that is now worth almost $100,000.

Again- of course, that’s an investment made - not running a scenario of a path not chosen.

 

[NH-to-FL]

When people talk about oversaving or think about what they need to retire, many don't consider (or don't want to think about) long term care needs.

Yes, long term care must be part of retirement planning. I didn't mention it but a significant part of my possible "over saving" is allocated for a lengthy long term care period for both DW and I.

i used $100K/year/person as a budgeting number. It is probably higher today and going up but, at the moment, so are my investments.

 

[longboard55]

I am a stock market guy, but you need to know it is not a straight climb, it goes up and down, I have had amazing years but also some real bad ones. Overall the gains have been far better but you need to have the stomach to take it. My suggestion is to start slow in the index etfs and build over time.

 

[dvcgirl67]

Yes, long term care must be part of retirement planning. I didn't mention it but a significant part of my possible "over saving" is allocated for a lengthy long term care period for both DW and I.

i used $100K/year/person as a budgeting number. It is probably higher today and going up but, at the moment, so are my investments.

We're planning on LTC for both of us as well, but what we're not doing is purchasing LTC insurance because I don't trust that product. I know that there are occasional stories of times when it has worked out for people, but that's typically people who purchased it many years ago and were able to use it before the premiums skyrocketed. We plan to pay out of pocket for any LTC we need with our portfolio....and as you've said, is one of the reasons we've "over saved".

As someone else said, if we're not okay with the amount that we've saved.....then most Americans are in deep, deep trouble. So far, we've not had any dementia-related LTC stays on either side of our family....with our parents or grandparents, and so hopefully our family luck will continue to hold on that front. Otherwise, we're budgeting for roughly 12K a month for 2.5 years (average LTC stay) for each of us in an LTC facility. It's just a part of the portfolio...not "sectioned off" or anything. We model it by increasing our spending dramatically at the end of each of our life spans in the financial planning software we use (Projection Lab).

We're almost 57 and 56....75/25 portfolio and building a five year cash position to kick off retirement.

 

[QueenIsabella]

We're planning on LTC for both of us as well, but what we're not doing is purchasing LTC insurance because I don't trust that product. I know that there are occasional stories of times when it has worked out for people, but that's typically people who purchased it many years ago and were able to use it before the premiums skyrocketed. We plan to pay out of pocket for any LTC we need with our portfolio....and as you've said, is one of the reasons we've "over saved".

As someone else said, if we're not okay with the amount that we've saved.....then most Americans are in deep, deep trouble. So far, we've not had any dementia-related LTC stays on either side of our family....with our parents or grandparents, and so hopefully our family luck will continue to hold on that front. Otherwise, we're budgeting for roughly 12K a month for 2.5 years (average LTC stay) for each of us in an LTC facility. It's just a part of the portfolio...not "sectioned off" or anything. We model it by increasing our spending dramatically at the end of each of our life spans in the financial planning software we use (Projection Lab).

We're almost 57 and 56....75/25 portfolio and building a five year cash position to kick off retirement.

I'm not a fan of LTC insurance, for the same reasons you aren't. We're planning for what we call a "million dollar disease", be it cancer, dementia, Parkinson's, etc. Our family histories aren't very promising, although all 4 of our parents died fairly quickly, for better or worse. If DH and I "go easy", our kids will benefit. On the good side, I'm not generally worried about leaving a legacy to my kids--their grandmother was generous, they'll graduate college with no student loans and 6- figure trust funds. I'll likely be generous with any grandkids...if any show up.

 

[dvcgirl67]

I'm not a fan of LTC insurance, for the same reasons you aren't. We're planning for what we call a "million dollar disease", be it cancer, dementia, Parkinson's, etc. Our family histories aren't very promising, although all 4 of our parents died fairly quickly, for better or worse. If DH and I "go easy", our kids will benefit. On the good side, I'm not generally worried about leaving a legacy to my kids--their grandmother was generous, they'll graduate college with no student loans and 6- figure trust funds. I'll likely be generous with any grandkids...if any show up.

Yeah, no kids here so not worried about an inheritance. The thing with LTC insurance, is that companies have not been able to adequately forecast the incredible increase in LTC costs and so people are often hit with huge increases in their premiums. Also, if we experience another Great Recession or 2001/2002 drop in the market in the next 25 years (very likely), some of those LTC companies will go under, in some cases leaving customers with nothing. It's happened before....it'll happen again.

And private equity firms have moved into this space as well, making the product even less attractive to me as a consumer. I also know lots of people over the years that end up hiring a person to help at home privately, even as a live-in and pay them privately which can be much, much cheaper than going through official agencies...etc.

 

[tvguy]

My mom bought a type of long term care insurance policy that is no longer offered. Probably because it was a good value, IMHO.
The premium was a single payment equal to about a third of my mom's savings.
The plan paid a maximum of $2,700 a month for 3 years. (The average need for LTC in the U.S. is 18 months, and her care 11 years ago cost $3,300 a month)
If you did not use any of the coverage, your heirs got 100% of the premium back.
If you did use it, they subtracted what they paid out from the premium, if there was any money left, your heirs got that.
My wife and I bought a different type plan, it pays a fixed amount each month, started at $5,000 with a 5% inflation factor every year and pays for a fixed time, up to 5 years.
My brother and sister in law decided to skip LTC and pay out of pocket until they draw down their savings, then sell their house and move in with their daughter. Their 90 and 86 and so far that has worked for them.
The big issue with LTC is you just don't know if you will need it and for how long.

 

[tvguy]

Again- of course, that’s an investment made - not running a scenario of a path not chosen.

Sorry, I see those as the same thing. Both were options. I just think it is normal human nature to be curious what "would have" happened, and not just investments.
There are two other houses in our area we considered when we bought our house 41 years ago. Even to this day we look at those houses and neighborhoods and chat about what could have /would have been if we had chosen them.
My next door neighbor replaced his HVAC at the same time as I did, but bought a different brand, and from time to time he asks how ours is doing as he reviews his decision.
I do it with cars we have purchased too. Although was have kept cars as long as 31 years, so not sure the current state of an automakers products applies. I last bought a Toyota, our first. If you had told me in the 1970's when I had a series of tin can Toyotas as company cars that I would ever consider buying one, I would have laughed at you.

 

[clh2]

My retirement date is set in stone for April 4, 2025. 6 months, and 5 days…

Could have retired and of December, 2024, and then either using Cobra or the Affirdable Care Act for insurance until I hit 65 in June 2025. (DH switching on to Medicare Jan 1, 2025)

However…2024 bonus gets paid out in Early March. And on 3/8, I will advance from 60% vested to 80% vested in a deposit my employer makes in late March (3% into 401k). So, if I am hanging around until late March, might as well work into early April, as I I will then get insurance for the whole month.

If they want me longer than that…I might consider 24 hours a week until early June, But then my new job kicks in, with the cutest bosses who will be 6, 4 and 2! Nope, not doing full time daycare, but definitely want to be “on-call”!

 

[China Expat]

My wife worked for a suburban city near Seattle and didn't pay into Social Security. They put the money into a 401k type plan instead. When she retired at 53 after 28 years it had $700k. It was very lucrative. She also will still get social security too as she got 40 quarters of payments into the system from previous other jobs. Not a bad deal.

Same with me...Required monthly distributions into TIAA CREF for 35 years plus social security.

 

[China Expat]

I just returned from a week away in Bogota, Colombia, with 900 international students and educators at a conference. WHile I was nervous about not having a solid monthly income other than social, which starts in two weeks, I was struck by the couple next to me last night on the flight to LAX. She said their philosophy in their late 60s as retirees is to "go go go." In their 70s it will be"go, maybe slow." From then onward in their 80s, it could be "no go" based on health. They are traveling heavily now as the future is not always guaranteed. I am booking a Rwanda gorilla trek for June, thanks to their inspirational modeling.

 

[dvcgirl67]

I just returned from a week away in Bogota, Colombia, with 900 international students and educators at a conference. WHile I was nervous about not having a solid monthly income other than social, which starts in two weeks, I was struck by the couple next to me last night on the flight to LAX. She said their philosophy in their late 60s as retirees is to "go go go." In their 70s it will be"go, maybe slow." From then onward in their 80s, it could be "no go" based on health. They are traveling heavily now as the future is not always guaranteed. I am booking a Rwanda gorilla trek for June, thanks to their inspirational modeling.

Yes, this is the "GO-GO", "Slow-Go" and "No-Go" philosophy that I hear a lot about now in retirement planning circles. It's helped us to do our planning because we plan to travel as much as we possibly can from now 57....into our mid-70s if health allows.

We just got back from South Africa....and it was just a dream, and Rwanda is also on our list. Good for you for booking that! We're so inspired and invigorated when we travel and we're going to GO-GO as long as we can. Costa Rica for 8 nights in late January and just decided today on a 9 night trip to Ireland in July (have never been!).

Here's to Go-GOING....as long as we can.

 

[tvguy]

Yes, this is the "GO-GO", "Slow-Go" and "No-Go" philosophy that I hear a lot about now in retirement planning circles. It's helped us to do our planning because we plan to travel as much as we possibly can from now 57....into our mid-70s if health allows.

We just got back from South Africa....and it was just a dream, and Rwanda is also on our list. Good for you for booking that! We're so inspired and invigorated when we travel and we're going to GO-GO as long as we can. Costa Rica for 8 nights in late January and just decided today on a 9 night trip to Ireland in July (have never been!).

Here's to Go-GOING....as long as we can.

My problem is trying to find TIME to go. I had 10 obligations this month scattered in a such a way that we couldn't go anywhere.
And next month, we are going on a three night trip to the coast, but I have 8 individual obligations and JURY DUTY potentially for 10 days (or more). They don't warn you that ADULTING continues in retirement.